Tag Archives: South Salem NY Real Estate

Builder confidence in the market for newly-built single-family homes jumped seven points to a level of 70 on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI). This is the highest reading since July 2005.

The increase in market confidence follows the November election results, increasing hopes among home builders and other stakeholders in the residential construction industry that the incoming administration will reduce costly regulatory burdens, particularly for small businesses. Research from NAHB published earlier this year indicated that for home builders, such regulatory costs have risen by more than 29% over the last five years.

While the significant increase in builder confidence for December could be considered an outlier, the fact remains that the economic fundamentals continue to look good for housing as we head into 2017. And the rise in the HMI is consistent with recent gains for the stock market and consumer confidence. At the same time, builders remain sensitive to rising mortgage rates and continue to deal with shortages of lots and labor.

Derived from a monthly survey that NAHB has been conducting for 30 years, the NAHB/Wells Fargo Housing Market Index gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor.

All three HMI components posted healthy gains in December. The component gauging current sales conditions increased seven points to 76 while the index charting sales expectations in the next six months jumped nine points to 78. Meanwhile, the component measuring buyer traffic rose six points to 53, marking the first time this gauge has topped 50 since October 2005.

30-year fixed-rate mortgage (FRM) averaged 3.47 percent with an average 0.6 point for the week ending October 13, 2016, up from last week when they averaged 3.42 percent. A year ago at this time, the 30-year FRM averaged 3.82 percent.

15-year FRM this week averaged 2.76 percent with an average 0.6 point, up from last week when they averaged 2.72 percent. A year ago at this time, the 15-year FRM averaged 3.03 percent.

Average commitment rates should be reported along with average fees and points to reflect the total upfront cost of obtaining the mortgage. Visit the following link for the Definitions. Borrowers may still pay closing costs which are not included in the survey.

QuoteAttributed to Sean Becketti, chief economist, Freddie Mac.

“This week the 10-year Treasury yield continued its climb as an increasing number of financial market participants foresee a December rate hike after a series of positive economic data releases. The 30-year fixed-rate mortgage moved up 5 basis points to 3.47 percent in this week’s survey, the first increase in one month. Even though we’ve seen economic activity pick up, consumer price inflation and implied inflation expectations remain below the Federal Reserve’s 2 percent target.”

That’s the landscape for much of the Southern California housing market as the spring selling season gets underway. Competition is as fierce, or even greater, than last year in many corners of the Southland, and would-be buyers can expect a pitched battle if they want to close a deal, real estate agents say.

The frenzied start has been driven by a dearth of homes for sale, low mortgage rates and steady job growth. Homes are selling faster than a year earlier, with more of them going for above the list price, data from online brokerage Redfin show.

Another sign of the market’s strength came this month when data provider CoreLogic reported that sales in February jumped 9% from a year earlier. The median price, meanwhile, climbed 3.7% — the 47th straight month it’s risen.

Kyle Kim

Lazerson said his clients in Los Angeles and Orange counties are putting an average of five offers on a house before they’re successful. And he’s seeing more demand from first-time home buyers, as well as those who want to upgrade to a bigger home.

“The market seems to be healthy again on all levels,” he said.

Real estate agent Heather Presha has seen the craziness firsthand.

With few homes for sale in the Leimert Park neighborhood where she works, buyers are flooding open houses that pop up. Many are coming from the Westside, no longer able to afford a home near the ocean as prices have steadily risen across the region.

The added demand is pushing values higher in the South L.A. neighborhood filled with old Spanish-style homes.

Pat Douglas, another agent in Leimert Park, put it this way: “Anything good that is on the market is going quick with multiple offers.”

In Los Angeles County, there was a 4.9-month supply of homes for sale in February compared with a 5.2-month supply a year earlier — meaning no homes would be on the market after that time period if sales continued at their current pace and no new listings emerged, according to the California Assn. of Realtors. Orange County saw a similar trend.

Kyle Kim

The Realtors consider a six- to seven-month supply a market that favors neither buyers nor sellers.

Recently there’s been a healthy jump in listings, Richardson said, but it’s unclear if the trend will hold.

If it does, house hunters such as Abigail Lee and her husband, Ray, would be overjoyed.

The couple are looking for a home under $2 million, but they’ve found little suitable near a good public school. They’ve put in only two offers in the roughly six months they’ve been looking — and were unsuccessful both times.

The economic and housing recovery continues at a slow, but steady pace. For the country as a whole, theNAHB/First American Leading Markets Index (LMI), released today, rose to .94 in the fourth quarter of 2015, .01 point higher than its level in the third quarter of 2015, .93, and .04 point higher than its level from one year ago, .90. The index uses single-family housing permits*, employment, and home prices to measure proximity to a normal economic and housing market. The index is calculated for both the entire country and for 337 local markets, metropolitan statistical areas (MSAs). A value of 1.0 means the market (or country) is back to the last level of normality.

Nationally, all three components of the LMI contributed to the 4-quarter growth in the nationwide score, .04 point to .94, but only house prices and permits contributed to the quarter-over-quarter increase, .01 point, as the employment component of the LMI was unchanged over the last 3 months. Over the year, the house prices component increased from 1.32 to 1.38, 1.37 to 1.38 over the quarter, the permits portion rose from .44 to .48, .47 to .48 over the quarter, and employment rose from .95 to .96, remaining unchanged over the quarter. Regionally, 117 of the 337 markets, 35%, have an LMI Score that is greater than or equal to 1.0 and are considered normal.

While most markets do not have an Overall LMI Score that is greater than or equal to 1.0, a recovery in one or more components of the LMI has taken place in MSAs across the country. At 322, the number of MSAs where house prices have reached normal is the highest of any of the LMI components, however that level has been unchanged over the year. In contrast, the recovery in employment and in permits is smaller but spreading, with the expansion in employment further along. The number of MSAs whose employment component has recovered reached 76 in the fourth quarter of 2015, 11 more than its level in the third quarter and a 73% increase from its level from one year ago, an additional 32 markets. Meanwhile, the number of MSAs whose permits score reached or exceeded 1.0 totaled 41, 8 more than the previous quarter and 17 more than 1 year ago

“It is important to recognize that 2016 is shaping up to be the best year in recent memory to sell. Supply remains very tight, so inventory is moving faster. Given the forecast that price appreciation will slow in 2016 to a more normal rate of growth, delaying will not produce substantially higher values, and will also see higher mortgage rates on any new purchase,” wrote Realtor.com Chief Economist Jonathan Smoke recently.

Should his sage advice to sellers fall on deaf ears, 2016 could produce one of the most miserable housing market in years. After seven years of struggle, the issue no longer is demand, it’s supply. Anemic inventories are artificially driving up prices that keep first-time buyer trapped in rentals, which as expect to soar again this year.

Home sales prices have risen between 15 and 20 percent over the past three seasons, depending on which series you believe. We’re less than 18 months away from reaching a national median sales price that’s higher than the very highest peak at the very top of the housing bubble in 2006.

Frozen stiff without enough equity to sell for nearly decade, owners at last have made it to the light at the end of the tunnel. They can sell and cash out. They can refi or take out a HELOC and stay put. Moreover, with experts predicting that sale prices will moderate in 2016 to 4-5 percent appreciation from 6 percent as the market slow down to catch, this could be the perfect year to sell.

With the clock ticking on the opening of the 2016 season, now is the time potential sellers are making up their minds to sell or not.

Fannie Mae

In Fannie Mae’s December Home Purchase Sentiment Index, fewer than half of respondents said it’s a good time to sell (49 percent) and 41 percent said it’s a bad time to sell. Not exactly a strong endorsement but at least movement in the right direction. The best thing about the findings was that in November the sentiment to sell was even lower—48 percent said it was a good time and percent and 44 percent said it was a bad time.

In December less than half of Fannie Mae’s survey sample said it’s a good time to sell.

The net percentage of respondents who say it is a good time to sell a house rose after falling for two months in a row – rising 4 percentage points to a net 8 percent positive at the end of the year. Not much of an improvement over last year.

Twenty percent 0f Trulia’s sample of consumers said 2016 will he a better year to sell than 2015, and 36 percent more than in 2014.

Trulia

Trulia’s housing predictions survey showed real positive change as consumers recognized 2016 is a significantly better climate to sell than 2015 was. Some 20 percent said it will be better than 2015 to sell and 14 percent said it 2015 would he better than 2014, for a net gain of 36 percent in two years, more than a third of consumers.

The count of unfilled jobs in the overall construction sector increased in November, as hiring in the home building sector accelerated.

According to the BLS Job Openings and Labor Turnover Survey (JOLTS) and NAHB analysis, the number of open construction sector jobs (on a seasonally adjusted basis) increased to 135,000 in November from 121,000 in October. The cycle high of 168,000 open positions was set during March.

On a three-month moving average basis, the open position rate (job openings as a percent of total employment) for the construction sector held steady at 1.9% for November. The overall trend for construction open jobs has been increasing, although the current open rate is down from the cycle high last reached in May (2.4%) as construction hiring picked up in recent months.

The construction sector hiring rate, as measured on a three-month moving average basis, increased to 5.1%, although it remains near rates set in the spring of 2015. The quits rate for construction jumped to 2% for November, the highest rate since December 2014.

Monthly employment data for December 2015 (the employment count data from the BLS establishment survey are published one month ahead of the JOLTS data) indicate that home builders and remodelers increased hiring significantly on a seasonally adjusted basis for the last two months. Total residential construction employment grew by 23,100 for December, after a pickup of 31,500 for November. The November gain was the largest single increase during the post-recession period.

The pace of hiring for the residential construction industry had been slowing over the course of 2015. With the jumps in November and December however, the six-month average of monthly employment growth is now a healthy 15,000.

Residential construction employment now stands at 2.534 million, broken down as 710,000 builders and 1.82 million residential specialty trade contractors.

Over the last 12 months home builders and remodelers have added 137,000 jobs on a net basis. Since the low point of industry employment following the Great Recession, residential construction has gained 547,700 positions.

In December, the unemployment rate for construction workers increased slightly to 7% on a seasonally adjusted basis, up from the cycle low of 6.5% set during July. The unemployment rate for the construction occupation has been on a general decline since reaching a peak rate of 22% in February 2010.

Many builders continue to cite access to labor as a top business challenge as the market recovers (for example, see this NAHB survey on the issue, focusing on builder and subcontractor workers).

For the economy as a whole, the November JOLTS data indicate that the hiring rate held steady at 3.6% of total employment. The overall open job rate increased to 3.7%, near the 3.8% cycle high set during July.

It’s official. It took six grueling years since the Great Recession ended, but now, the housing recovery enters the second half of 2015 as a fundamentals-driven rebound.

What does it mean now that housing—and its infinite mosaic of geographical fiefdoms down to the submarket and lot-line level—has healed its gravest wounds? What does it mean to developers and builders that buyers and sellers of home properties are people to people, not desperate people to institutions? What does it mean when we say that a housing cycle’s trajectory has moved decisively from a focus on investors’ resources to an exchange of values from owner-occupier to someone who wants to be an owner-occupier of a primary residence?

As we note from RealtyTrac’s latest U.S. Home & Foreclosure Sales Report for May, all of the benchmarks for abnormal residential real estate behavior—cash sales, distressed sales, bank-owned sales, and in-foreclosure sales—dramatically subsided in the past month and, even more dramatically so in the past 12 months.

Here are a few of the highlights of the RealtyTrac May Foreclosure report, noted by Daren Blomquist, vice president at RealtyTrac.

24.6 percent of all single family home and condo sales in May were all-cash purchases, down from 28.5 percent in the previous month and down from 30.4 percent a year ago to the lowest level since November 2009

The share of distressed sales dropped to a new low of 10.5 percent in May, down from 15.4 percent in April and down from 18.3 percent a year ago

Bank-owned sales accounted for 3.9 percent of all residential property sales in May, down from 6.9 percent in the previous month and down from 9.0 percent a year ago

Properties that sold while in the foreclosure process — but not yet bank-owned — accounted for 6.6 percent of all residential property sales in May, down from 8.5 percent the previous month and down from 9.2 percent a year ago

The market has spoken. It’s no longer rewarding investor opportunism, short-term gains for cash-flush buyers, nor quick flippers, nor even global “safe-haven” buyers who buoyed the marketplace as deterioration switched to resilience three years ago.

S&P Case Shiller’s adjusted 20-city house price index rose a very solid and slightly higher-than-expected 1.0% in March with gains across all cities and well balanced gains across all regions.

These gains, however, were not confirmed by the Federal Housing Finance Agencyhouse price index, which rose a lower-than-expected 0.3% in March. The most optimistic reading for March came from Black Knight Financial Services (BKFS), a Fidelity National Financial (FNF) company.

Black Knight’s index says that home prices were up 1.2% in the month of March and up 4.8% on a year-over-year basis. Those totals represent the largest monthly gain in national home prices since June 2013.

“As we move deeper into the traditional home buying season, the low level of homes for sale in many markets is continuing to push prices higher,” said Quicken Loans Vice President Bill Banfield. “Once more owners realize the opportunity to sell their home, price gains will slow and prices may even dip in response to the greater choice for buyers.”

Year-on-year readings in both the S&P and FHFA reports show an improving trend, at a moderate 5% for Case-Shiller and plus 5.2% for FHFA.

“Home prices have enjoyed year-over-year gains for 35 consecutive months,” says David Blitzer, Managing Director & Chairman of the Index Committee for S&P Dow Jones Indices. “The pattern of consistent gains is national and seen across all 20 cities covered by the S&P/Case-Shiller Home Price Indices. The longest run of gains is in Detroit at 45 months, the shortest is New York with 27 months. However, the pace has moderated in the last year; from August 2013 to February 2014, the national index gained more than 10% year-over-year, compared to 4.1% in this release.

As the year ended, 39 percent, or 117, of the nation’s largest 300 markets achieved full price recovery, up 30 percent from the end of 2013. Hundreds of other markets moved closer to full recovery; by December, the average rebound percentage of all 300 markets was 95.85 percent, which was slightly higher than 95.49 percent recorded in November.

Markets that lost the least value during the Great Recession have been the first to rebound. Of the markets with a peak-to-trough decline of less than 10 percent, 25 had an average rebound of 107 percent in December. Of the markets that lost 10 to 20 percent of value, the average rebound reached 99 percent of the prior peak price in December. In the markets that suffered the most severe price declines, the average rebound percentage was 81 percent.

In December, 42 of the top 100 markets measured continued to show a complete price recovery, increasing by two from November. Jackson, MS and NashvilleDavidson-Murfreesboro-Franklin, TNwere the new markets rebounding at 100.15 percent and 100.16 percent, respectively.Additionally, 75 midsize markets saw a rebound above 100 percent, up by four markets from November’s report.

“Great progress was made in the housing market during 2014. It put the real estate sector within striking distance of a majority of the nation’s 300 largest markets reaching full price recovery. As markets reach new price peaks, they are restoring equity to millions of homeowners, making it possible for them to refinance or sell,” said David Mele, president of Homes.com.

The pace of housing starts declined 2% in January, including a significant decrease in single-family construction in the Midwest connected to weather factors. Nonetheless, the current pace of home construction remains strong and growth should continue in 2015.

According to the joint Census Bureau and HUD release, the seasonally adjusted annual rate of housing starts came in at 1.065 million, down from a revised pace of 1.087 million in December 2014.

The rate of starts for single-family construction was down 6.7% from December, yielding a 678,000 annual pace. Most of this decline is attributable to a 31% drop for single-family starts in the Midwest, which fell from a 133,000 annual rate in December to 92,000 in January.

This decline is consistent with elements of the February NAHB / Wells Fargo Housing Market Index, which suggested declines in builder confidence due to weather factors. However, builder sentiment remains positive, and NAHB expects single-family starts to rise in the coming months given favorable job creation numbers and pent-up housing demand.

Multifamily starts remained strong in February, rising 7.5% to a 387,000 seasonally adjusted annual rate. The three-month moving average of multifamily starts has been above 350,000 since April of 2014.

As a check on the state of the recovery in housing construction, the government data also includes a summary of housing units under construction. On a seasonally adjusted basis, there were 839,000 total homes under construction as of January. The single-family total was 366,000, which is the highest for the post-recession period and almost 9% higher than January 2014.

Multifamily units construction stand at 462,000, also a post-recession high. This estimate is more than 25% higher than the January 2014 total of 368,000.